EUR/GBP moves up to its highest level since 12 February
You can chalk this up to the pound getting a reality check ahead of the UK post-Brexit negotiating mandate release tomorrow or you can pin the move today to the typical Buba month-end flows but both arguments also call for a weaker pound.
In any case, EUR/GBP has now pushed higher to fresh two-week highs and is continuing a solid bounce off key support around 0.8300.
From a technical perspective, there may be little to stop the pair from rebounding back towards 0.8500 from hereon but I would argue that euro sentiment still remains iffy for now - so any major upside move beyond this is still questionable.
My argument for the pound weakness today is that it relates more to month-end flows but with the asymmetric risk ahead of post-Brexit talks, it is also creating a bit of a skew for further downside in the currency in the near-term.
For now, cable is also making its way back below both key hourly moving averages and that may set up a retest of the 1.2900 handle again in the pair next.
A firm break below 1.2850 there may trigger stops on the way down and put more pressure in the pound, so that could be a catalyst for a further move higher in EUR/GBP too.
